Verizon Communications Inc, the largest US local-telephone company, and unions representing 78,000 workers agreed to continue contract negotiations as a midnight deadline passed, averting a strike for now.
Enough progress has been made to extend talks and delay a walk out, union officials said. Key issues remain unresolved, Morton Bahr, the president of the Communications Workers Association said in a statement. Talks broke off for the evening and will resume at 10:00am New York time, officials said.
"Negotiations are continuing and because of that our people are still on the job," Jim Spellane, a spokesman for the International Brotherhood of Electrical Workers.
Verizon is seeking to avert a strike that threatens to cause phone installation and repair delays and weigh on the company's revenue and share price.
The company and unions are holding talks in Washington and New York after seven weeks of discussions to set new contract terms.
Three-year contracts for the workers, 60,000 of which are represented by the CWA and the rest by the IBEW, expired at midnight.
Federal mediator Peter Hurtgen, who helped resolve the dockworkers' dispute last year, has been helping shepherd the negotiations since Tuesday. Verizon president Lawrence Babbio joined discussions in Washington.
"We expect to just keep the process going here," said Verizon spokesman Eric Rabe.
"Service disruptions may be inevitable" if workers strike, said Craig Nedbalski, managing director at Victory Capital Management, which holds about 9 million Verizon shares and manages US$60 billion. "There could be some short-term volatility in the shares."
On Friday, Verizon stock fell US$0.62 to US$34.38 in New York Stock Exchange composite trading.
Verizon, faced with falling demand for local calling, wants workers to pay some of their health-care costs and leeway in firing workers and moving jobs.
The two unions are seeking freer rein in organizing workers at Verizon Wireless and guarantees their members will be employed to help the company expand its high-speed Web access network.
The workers represent about 50 percent of Verizon's local and long-distance telephone company.
Before the existing agreements were signed in 2000, Verizon employees stopped work for 18 days, resulting in service disruption. During the strike, a New York Supreme Court judge issued a restraining order against pickets after Verizon reported acts of vandalism and intimidation.
Verizon has been training more than 30,000 managers in tasks usually handled by union members in a bid to minimize the loss of business.
The company has trained staff how to repair damaged lines and maintain pay telephones.
It also barred staff from taking vacation this month, tried to lure back thousands of recently retired managers and lined up outside contractors to handle some tasks.
The CWA, which represents about 60,000 of the workers with contracts under discussion, wants assurances that Verizon won't try to block the union from seeking members at Verizon Wireless, the No. 1 US mobile-phone carrier.
Verizon is pressing for flexibility in moving jobs to reflect changes in demand.
The company wants to be able to transfer as many as 8 percent of the jobs covered by the contracts, up from 0.7 percent now.
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